MBC caught in contract mess

• K57m blown on e.tv programmes obtained without owner’s consent

Malawi Broadcasting Corporation (MBC) has found itself entangled in a contract mess after paying over K57 million to a South African company, Thuso Group Limited, for television services that might have been illegally obtained and were partially rendered, Weekend Nation can reveal.

In August 2013, MBC entered into a one year agreement, worth K84 million, with Thuso Group to provide the corporation with three television programmes to be tapped from e.tv, a South African television.

In the agreement between MBC and Thuso Group Limited, that Weekend Nation has seen, MBC was expected to pay Thuso Group K7 million per month—for beaming Scandal, Rhythm City and World Wrestling Entertainment (WWE)—on top of a one-off K1.4 million payment for a decoder.

The agreement further required MBC to pay Thuso Group 35 percent of the revenue that the public broadcaster would generate in advertisements accompanying the three programmes.

But throughout the eight months the deal was in operation, MBC only managed to make K6 million through advertisements accompanying the e.tv programmes, despite coughing up K56 million on the same, the corporation’s board chairperson Moffat Banda disclosed this week.

Weekend Nation investigations have further established that e.tv did not authorise Thuso Group Limited to sell its content to MBC.

“e.tv is unaware how its properties came to be sold to MBC by Thuso without e.tv’s authorisation,” said e.tv head of corporate affairs Vasili Vass.

In an e-mail response to our questionnaire, Vass explained that in 2012, e.tv held initial discussions with Thuso Group but no contract was signed as discussions were not concluded.

Banda expressed surprise when he was told that there was no deal between e.tv and Thuso Group regarding the three programmes.

Said Banda: “MBC management noticed that the agreement was not benefitting the corporation and decided to terminate it.”

“We realised we paid a lot of money but the services were not consistently provided.”

Banda—whose board came into operation after the contract was terminated—said MBC could have invested the money in four brand new vehicles to ease the transport problem that the corporation is facing.

In the agreement, signed by the then MBC director general Benson Tembo and Thuso Group country director Ganizani Kuchombo, MBC was asked to destroy the recordings within 24 hours.

Reads part of the agreement: “MBC shall destroy the recorded programme and any part thereof, within 24 hours of broadcast and distributor undertakes to procure that MBC shall so destroy each recording and shall certify the destruction of the recorded programmes at the end of each month of the term of agreement.”

The agreement also stopped MBC from using e.tv logos such as e-africa and e-news without approval from Thuso Group.

“In the event that MBC wishes to use the e-africa logo in marketing in the channels or for and whatsoever, broadcaster shall obtain prior approval from country director at Thuso Group Private Limited,” reads the agreement.

When contacted this week, Tembo, who is now technical adviser for digital migration at Malawi Communications Regulatory Authority (Macra), said Thuso had acquired rights from e.tv for aggregated programmes which were received via satellite through an e.tv decoder.

“All procurement procedures were followed and government approvals obtained and all records were maintained,” he said.

The decision to procure Thuso’s services was approved by MBC ’s internal procurement committee and the corporation’s request for single source procurement of the television programmes from the Office of the Director of Public Procurement (ODPP) was approved in June 2013.

In the contract between Thuso Group and MBC, two company names— Thuso Technologies and Thuso Group—are used interchangeably although both are said to be owned by Alexander Banda.

Weekend Nation managed to talk to Banda on his mobile phone in South Africa where he promised to respond to an e-mailed questionnaire on Tuesday but he did not respond nor pick all subsequent phone calls from this journalist.

According to the agreement, Thuso Technologies, with Alexander Banda in his capacity as director of distribution, was to be distributing material sourced from Thuso Group (Proprietary) Limited with Alexander Banda in his capacity as chief operating officer.

Copyright Association of Malawi (Cosoma) senior licensing officer Rosario Kamanga said generally, unauthorised use of a copyright work constitutes an infringement. He, however, said it was difficult for him to comment on the matter without seeing the contents of the licence.

“In as far as copyright is concerned, since it is an exclusive right granted to an author/creator on his work, it can be exploited by the creator himself or someone who has been authorised by the creator himself or his authorised agent to use the work, unless one relies on the limitations and exceptions granted under the Copyright Law,” he said.

In the agreement, Thuso Group gave MBC the right to broadcast the programmes.

“The distributor acknowledges and agrees that the licence hereby granted is exclusive to and undertsakes that it will not permit any other person save MBC to broadcast the programmes or receive the channel and the channel feed as received by the decoder from time to time or part thereof and will not sublicence, sell or otherwise provide the channel, the channel signal or the programmes or any content forming part of the programme from the channel to the third party,” reads part of the agreement.